Fixed line subscribers switch to cellphones

Over half-a-million fixed line subscribers have switched to using cellphones in the past four months, thanks to low cost of mobile handsets, aggressive marketing of tariff plans by cellular operators and declining tariffs.

The total number of both wireless and wireline users is 256.55 million, out of which 217.14 million use cellphones. During this period, the fixed line subscriber base has declined from 40.09 million (June) to 39.41 million (October), according to a report by the Telecom Regulatory Authority of India (Trai).

According to experts, state-owned telecom company Bharat Sanchar Nigam Limited (BSNL) was the worst affected losing about 90 per cent of the 6.8 lakh fixed line subscribers to telecom service providers such as Bharti Airtel, Vodafone-Essar, Tata Teleservices and Reliance.

"Mobiles have become cheaper so they are being preferred by the subscribers. If the fixed line operators do not rationalise their tariffs, this decline will continue.

In the US, local calls within cities are free, which gives an incentive for consumers to value their fixed lines too," said Mahesh Uppal, a telecom analyst.

However, T V Ramachandran, director general, Cellular Operators Association of India (COAI), underlined the importance of fixed lines for mobile subscribers as well.

"Fixed line phones are certainly more reliable when it comes to quality of service and utility. I think the present trend of decline in the fixed line subscriber base will stabilise beyond a point," he said.

However, according to Uppal, once the broadband penetration in the country increases substantially (about 5-7 million), consumers will start obtaining the fixed line connections.

Currently, the broadband subscriber base is 2.69 million compared to 2.42 million in June.